A bridge too far

The Second Severn Crossing was built in time and under budget, but the tolls that pay for the project remain unpopular

NOTHING seems to incite Liberal Democrat leaders more than a slab of concrete propped up across the Severn Estuary. As far back as 2006 Mike German AM branded the Severn Bridges Act “an ass”. In a recent Federation of Small Businesses-hosted Question Time, Kirsty Williams took up the cudgels and called passionately for the current Lab-Plaid administration to stop procrastinating and argue the case for Wales.

Temperatures have long been rising among the small business community over tolls charged to use the major river crossings both in England and here in Wales, and this is something the Lib Dems are acutely aware of. Although not all businesses are affected, the FSB wants road tolls abolished in England and Wales, following the lead of the Scottish Executive. After years of FSB lobbying, tolls on the Tay and Forth bridges were ended. It followed the abolition of the Skye Bridge toll in 2004 and means that there are no longer any tolls in that country. The move has been seen as helping to even things out between firms (and local communities) that previously had to use the bridges and those that didn’t, as tolls had been regarded as a barrier to business and a tax on enterprise.

The issue stepped up a gear following the FSB’s National Conference in Newport in March. Not only did many delegates ‘sample’ one of the most contentious tolls themselves – it now costs £5.40 per car to drive over the Severn bridges into Wales, with the charge only payable when you drive westwards from England – but it provided us with the impetus to now carry out research in conjunction with the University of Wales, Aberystwyth to determine whether the Severn tolls are having an economic impact on Wales.

Meanwhile, people in South Wales are continuing to rebel against tolls on bridges, with businesses in South and West Wales at a disadvantage compared with their counterparts on the Bristol side of the Severn.

Both Severn bridges are operated by a private company, which collects tolls to cover the cost of building the second crossing and maintaining both. The terms of the concession say the bridges will pass to the state once the private company has collected a certain amount – just under £1bn in today’s money. At current rates of traffic growth, that target income would have been met in June 2014. But in 2002 the Government decided to take about £150m in VAT from the tolls without increasing the charges, which are fixed by legislation. With a portion of each toll charge going to the Treasury, the private company receives less income from each driver. As a result, the company will not collect its target income by June 2014. Officials believe the full amount will not be collected until “sometime in late 2016”.

FSB members in South Wales want to highlight the impact of tolls, especially given that both tourism and logistics must rely upon the bridge. With the decline in traditional heavy industry there is now a much greater dependence on the Severn bridge for much economic activity.

Transport presents a significant cost for small businesses and it is essential that the Government finds ways to relieve this burden and increase competitiveness. There is evidence that the toll affects the behaviour of companies in terms of where they locate, and there is also evidence of HGV drivers using different routes to avoid the toll.

The FSB wants the Government to follow the Scottish example and legislate to abolish tolls on all bridges, tunnels and crossings, where there are no toll-free alternatives. This move would free up businesses to grow and create more jobs. The resulting economic growth would generate more funds for the Government to spend on better roads. This should be a priority, and Lib Dems are certainly lending us a sympathetic ear.

Research shows almost half of small businesses carry out their trade within 20 miles of their base. In a 2007 FSB survey of 3,500 members, 69% of businesses said that they could not reduce their vehicle usage and 93% said that a vehicle was either ‘crucial’ or ‘important’ to their business. So removing road tolls will reduce the overall road cost on business and remove a significant barrier to business growth. Such growth will boost the economy and create more jobs, as well as more tax revenue to invest in new road-building schemes.

Tolls on bridges and some highways are nothing new – there was a charge for crossing the Severn by ferry even before the first of the two Severn road bridges was opened in 1966, and drivers have had to pay to use the Humber bridge since it opened in 1981. The Government argues that the charges are essential to repay the debt to the Treasury incurred for the construction costs of these modern and essential pieces of engineering, and their ongoing repair and maintenance.

But what has angered campaigners, Lib Dem politicians and small businesses is the rate at which many tolls have risen – crossing the Humber Bridge now costs £2.70 in each direction for a car, rising to £18.30 for lorries weighing more than 7.5 tonnes, while using the Dartford Crossing (including the QEII Bridge) on the M25 means car or tight van drivers now have to fork out £1.50. The latter is a 50% rise, and the extra fee has generated large queues along the motorway as motorists used to finding a single £1 coin scrabble around for the extra change – creating the congestion the Government is so keen to avoid.

In addition, smaller firms are often unable to absorb rises as easily as multi-national corporations, and may be unable or unwilling to pass such extra charges on to customers.

It’s astonishing that, in these increasingly tough economic times, the Government should be viewing these crossings simply as a cash cow for the Treasury. They seem oblivious to the impact on small business and motorists of hiking up charges just as the downturn is starting to bite. At least one party, the Welsh Liberal Democrats, seems to recognise this and is starting to turn the screw on a bridge too far.